PARIS, Dec 20 (Reuters) - Airbus is talking to airlines about a longer-range version of its best-selling narrowbody jet family with a view to launching it by mid-2019 as it tries to head off a potential Boeing competitor, people familiar with the matter said.

Pre-marketing of the so-called A321XLR comes as Boeing contemplates an all-new aircraft to serve mid-market demand worth hundreds of billions of dollars, with a final decision on both aircraft expected in 2019.

Airbus has stepped up a gear and is actively "testing the market" for a newly defined XLR, one industry source said.

Initial plans for the A321XLR were first reported by Reuters in June. It would sit at the top of a narrowbody range driving most Airbus profits.

The upgrade would boost the A321's take-off weight to some 101 tonnes for the A321XLR compared with 97 tonnes for the longest-range A321LR, which can carry 206 people 4,000 miles in two classes and went to its first customer last month.

It would rely on more powerful engines already offered as an option, giving 33,000 pounds of thrust instead of 30,000 pounds.

An Airbus spokesman said the A321 "still has lots of potential" and declined comment on product strategy.

Until now, Airbus has kept Boeing guessing on how it might respond to its plans for a New Mid-Sized Airplane (NMA) with 220-260 seats between traditional small and large jet segments.

Among Airbus's top targets will be the major U.S. airlines, who could use the A321XLR to serve transatlantic routes with premium seats and who are also likely to be wooed by Boeing for its new jet. Their decisions could influence the fate of both projects.

The A321XLR would be less attractive for low-cost carriers who could not exploit the extra range without giving up part of their 240-seat preferred layout due to structural limits.

The contest for the middle of the market is expected to dominate the commercial jet industry in the coming year.

Boeing aims to define a new corner of the jet market with a wide-cabin aircraft capable of operating as cheaply as the workhorse single-aisle planes like the A321 and its own 737.

Without an all-new design on its drawing board, Airbus is trying to squeeze its rival by tweaking profitable models above and below the NMA, but has had limited success with its larger A330neo and is directing effort where it has the most advantage.

With its A321XLR, Airbus aims to "shoot at the NMA from below," a person familiar with the plans said. However, it has already shelved plans for a much more extensive redesign.

Analysts say some questions remain about its performance, while the industry also faces an unresolved debate over how long passengers will sit in narrower fuselages as medium-haul jets get more and more range to complement dedicated long-haul jets. (Reporting by Tim Hepher; Editing by Sudip Kar-Gupta and Jane Merriman)